Supreme Court’s Boulder climate case could send your bills soaring
Washington Examiner · RC · trust 54/100
If it seems like everyday expenses are becoming less affordable, just imagine what you could pay if the Supreme Court decides that thousands of state and local governments can bring multibillion-dollar lawsuits against energy companies for their alleged contributions to climate change .
The Supreme Court is scheduled to hear arguments in Suncor Energy (U.S.A.) Inc. v. Board of County Commissioners of Boulder County , a case considering that very question, on Oct. 5.
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At issue is a 2018 case in which the City of Boulder, Colorado, and the County Commissioners of Boulder County sued international energy companies Exxon and Suncor in Colorado state court. The lawsuit — raising state-law claims, including public and private nuisance, trespass, unjust enrichment, and consumer protection — alleges that the companies contributed to climate change, knowingly misled the public about climate risks, and should pay for local climate-related costs.
The crux of the case that the Supreme Court agreed to hear is not about the merits of Boulder’s allegations, but whether Boulder, or any one of nearly 91,000 state, local, and tribal governments within the United States, can sue private companies over national and international issues like climate change.
Boulder isn’t the first jurisdiction to bring such a lawsuit. As an amicus brief filed by Advancing American Freedom notes, “Eleven U.S. states and dozens of city, county, and tribal governments across California, Colorado, Hawaii, Illinois, Maryland, New Jersey, New York, Oregon, Pennsylvania, Washington, and Puerto Rico, currently have active lawsuits seeking to hold major oil and gas companies liable for alleged climate damages.”
If local governments can use state tort law to seek billions of dollars from energy companies, an economic “tragedy of the commons” could ensue. Each locality will be incentivized to maximize its claims against energy companies while dispersing the costs of its claims nationally through higher energy prices .
With single jurisdictions such as Multnomah County, Oregon, demanding a $50 billion abatement fund plus $1.5 billion in future damages to “weatherproof” the county and New York’s Climate Change Superfund Act imposing $75 billion in fees on major fossil fuel producers over 25 years, the additional costs to energy producers, and thus consumers, could be enormous.
The possible escalation in costs goes beyond civil litigation.
As our colleague John Malcolm recently explained , “Using language usually reserved to describe serial murders, terrorist attacks, and mass shootings, several environmental activists are encouraging state prosecutors to charge energy executives and greenhouse gas emitters with murder or manslaughter for deaths that the environmentalist activists claim are directly related to their conduct.”
The prospect of criminal liability could further chill investment in energy production, raising the cost of capital and putting additional upward pressure on energy prices.
A peer-reviewed study of 108 climate lawsuits against publicly traded companies shows that companies are already pricing climate litigation costs into their operations. If individual localities could use state tort law as a de facto means of regulating conduct that is national and international in scope, it could fundamentally reshape our national energy system.
Climate policy by a thousand courtrooms could make everyday goods and services that already seem less affordable prohibitively expensive for many Americans.
The consequences would extend beyond the gas pump and monthly energy bills, affecting the cost of everything from manufacturing and shipping to air travel, groceries, healthcare, and housing.
An analysis from AAF’s Institute for Statistical Policy Analysis finds, and AAF’s amici brief summarizes, that “Litigation-imposed liability would therefore function as a regressive tax on the cost of every good and service that depends on affordable energy to produce.”
The Constitution’s framers understood that local government should be responsible for regulating most issues that affect the public’s everyday lives. But they also understood that the country’s national and international policy must be set by the federal government. The Supreme Court must recognize that leaving this sort of regulation up to each of America’s tens of thousands of localities would be both unconstitutional and destructive.
Energy is a universal input in American life. National energy and climate policy should be enacted by Congress, not litigated across thousands of state court cases. In the Suncor case, the Supreme Court should say so.
J. Marc Wheat is the General Counsel for Advancing American Freedom and Senior Legal Fellow at the Edwin Meese III Institute for the Rule of Law; Rachel Greszler is a Senior Research Fellow in the Plymouth Institute for Free Enterprise at Advancing American Freedom.
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